- The food business blog -
Dean Best's unique web log on the global food industry, key events, people and his own daily experiences. If you would like to offer your comments, opinions, suggest topics or just have a good rant, please feel free to email: Dean Best. |
Page number: 1 of 109 (1088 records)
Private label star waning?
5th November 2009 16:55
We heard from two players on the US stage today (5 November) – one retailer and one manufacturer – both of whom bore the same message.
According to the management of meat-to-bakery group Sara Lee and supermarket operator Delhaize, the tide could be turning against private label in the US.
Delhaize admitted that increased promotional activity from national brands had slowed the growth of its private label sales in the country.
"When national brands fight for the growth of their top line with some very interesting promotions consumers are interested. We have seen a lesser increase in private label than in 2008 and early 2009," Delhaize CEO Pierre-Olivier Beckers said
In addition, the Belgium-based group said that consumers had been trading down within its three-tier private label offering.
Meanwhile, again pointing to increased promotional activity from branded producers, Sara Lee also flagged up the slowed growth of private label.
However, Sara Lee admitted that it has failed to benefit from this trend because it has been slower to invest in lowering prices than a number of its branded competitors.
This is something the group will look to address in the coming months.
Nevertheless, as Barnes cautioned: "The hardest thing to avoid is doing crazy things in the market place... We will not do crazy things to drive that volume up."
Click here to read more Sara Lee's plans to boost volumes, or here to check out Delhaize's take on trends in private label sales.
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M&S premieres GBP10m ad campaign
4th November 2009 17:33
UK retailer Marks and Spencer will fit mince pies, cashmere jumpers, “big juicy birds” and handbags into a top-dollar Christmas television advertisements over the coming months.
M&S today (4 November) gave journalists a sneak preview of a celebrity-led festive marketing campaign, called “Chistmas wouldn't be Christmas without...”.
The nine adverts feature celebrities including Stephen Fry, Joanna Lumley, Jennifer Saunders, Myleene Klass and Wallace & Gromit.
The campaign, due for screening from 11 November, cost around GBP10m to create, M&S' executive director, marketing, Chris Sharp, revealed at a media briefing in London today.
The marketing spend is roughly equal to last year, when M&S showcased pop group Take That in its Christmas ads.
M&S will be hoping the investment, together with a cold winter snap, will bolster sales for the rest of 2009, with a January 2010 VAT increase lurking in the background.
The company also announced the launch of branded grocery and household products today, coinciding with its interim earnings statement.
M&S boss Sir Stuart Rose said the roll out will not materially change the business of Marks and Spencer, but simply add extra convenience.
A successful trial at 54 Marks and Spencer stores suggests the changes will not be received with the 'love it or hate it' feeling of one of the brands it will stock – Marmite.
However, the retailer will begin by merely dipping its toe into the waters of branded food, opting for “400 rather than 10,000 brands”.
“Let's see how it goes, if it doesn't we'd be the first to stop it. If it does work and it works better than our expectations, then we'll have a think about what the implications are. But it's not earth-shattering.”
Joe Ayling, just-style
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Processed food sours the mood
2nd November 2009 17:41
We all know that junk food is bad for you. But probably only a few of us realise the affect that scoffing that burger, biscuit or fatty fry-up has could stretch well beyond our waistlines.
According to new research published today (2 November) in the British Journal of Psychiatry, people who have a poor diet that is high in fatty processed foods are “significantly” more likely to suffer from future depression.
Researchers from University College London, who compiled data on 3,500 middle-aged civil servants, found people whose diet is high in processed foods have a 58% greater risk of depression than those who opt for the carrot over the cake. Meanwhile, people who eat the most whole foods are 26% less likely to suffer from depression.
Responding to the report, Dr Andrew McCulloch, chief executive of the Mental Health Foundation, observed: “The UK population is consuming less nutritious, fresh produce and more saturated fats and sugars. Significant changes in the way food is produced and manufactured have reduced the amounts of essential fats, vitamins and minerals we consume. New substances, such as pesticides, additives and trans-fats have also been introduced to the diet. This imbalance combined with a lack of vitamins and minerals is associated with depression as well as concentration and memory problems.”
And, with mental health campaigners joining the ranks pressuring food manufacturers to improve the health profile of their products, this latest piece of research certainly gives the sector some more food for thought.
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EFFP sixth annual conference
2nd November 2009 15:24
Tomorrow (3 November), the English Farming and Food Partnership will hold its sixth annual conference in London headed ‘Routes out of Recession’.
Speakers include Marc Bolland, CEO of Morrisons, Peter Kendall, president of the NFU, Jonathan Warburton, chairman of Warburtons and Bill Bartlett, corporate affairs director of McCain Foods.
Topics expected to be covered include the future of the domestic supply of raw materials, which businesses have been successful in tackling the recession and whether there will be new investment opportunities in farming and food.
Of course just-food will be in attendance bringing you news from the speakers so check back tomorrow for more insight.
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Rieber & Søn shines spotlight on Russian strains
30th October 2009 17:49
Scandinavia's food companies have a rather pleasing habit of making their CEOs available at the drop of a hat and, this week, we got to speak to the boss of Norwegian food group Rieber & Søn.
After reporting a mixed set of nine-month and third-quarter numbers on Thursday (29 October), Rieber & Søn CEO Patrik Andersson walked us through the group's performance and recent moves to reshape the business.
You can read more of our interview with Andersson here but it was interesting to note his comments on Russia, a market in which Rieber & Søn has a significant presence.
We've discussed Russia's travails on these pages before but Andersson offered some numbers that illustrated just how the downturn over there has hit his business.
"If my calculations are right, I think we are down on volume 25-30% in the quarter," Andersson admitted.
That's a steep drop. But, given the turbulent economic conditions in Russia, Rieber & Søn is unlikely to be alone.
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Palm oil in the spotlight
28th October 2009 15:34
Today's (28 October) publication of the WWF "palm oil scorecard" has revealed that, while the likes of Sainsbury's, M&S, Unilever and Cadbury are making progress on sustainable sourcing, there are dozens of other companies where a lot more work is needed.
Or, as the green campaigners put it this morning, where some need to "up their game".
The structure of the palm oil supply chain and cost of sustainable sourcing are frequently held up as two obstacles by food manufacturers and retailers that have yet to makes changes to the way they buy palm oil.
However, as Adam Harrison, the WWF's senior policy officer for food and agriculture told just-food this afternoon, cost should not be an insurmountable barrier, while there are ways to resolve supply chain issues - and he pointed to the GreenPalm certificates recently embraced by M&S in the UK.
just-food will be running a full-length interview with Harrison tomorrow. Palm oil is high on the sustainability agenda and, with the annual Roundtable Meeting on Sustainable Palm Oil being held in Malaysia next week, it is an issue that needs to be faced head on by all in the sector.
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Industry looks to take palm oil debate in hand
27th October 2009 15:40
The use of palm oil in scores of consumers' favourite products is widespread.
From shampoo to chocolate, palm oil is a ubiquitous ingredient in many a shopping basket but, until very recently, one of which consumers were little aware.
That, however, is changing. Environmental campaigners are stepping up their attacks on food companies for their use of palm oil, arguing that sourcing practices destroys rainforests and endangers animals including orang-utans, rhinos and elephants.
And so consumer awareness is growing. Cadbury, for instance, was forced to think again when it suffered a Facebook-led backlash after changing a recipe in New Zealand.
And when consumer awareness starts to grow, so does anxiety in food company boardrooms. There are plenty of executives who want to "do the right thing" - but nothing focuses the mind like the threat of a consumer boycott.
So, in recent weeks, companies have been practically falling over themselves to go public with moves to make their sourcing of palm oil more "sustainable".
UK retailers M&S and Sainsbury's have announced moves of their own, while chocolate giant Ferrero said it had struck a deal to secure "significant" supplies of palm oil.
Now, we have the daddy of them all, Nestle, insisting it will use only "sustainable" palm oil from 2015.
Whether that will be enough to stifle the protests from pressure groups, only time will tell.
We have got wind of one report that claims demand for sustainable palm oil remains too low. But more of that tomorrow.
More to come....
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FDA probe leaves Smart Choices smarting
26th October 2009 13:01
Here in the UK, we all know just how detailed - and divisive - the debate on how foods are labelled has become.
Late on Friday, after the UK had packed away for the weekend, came news that a similar debate is heating up on the other side of the Atlantic.
The Smart Choices Program, a set of nutrition labels backed by the likes of Kraft Foods, PepsiCo, ConAgra Foods and Unilever, and launched to much fanfare this summer, has hit a roadblock. And that roadblock comes in the shape of the US Food and Drug Administration.
The FDA is examining the nutrition claims made on labels under Smart Choices amid concerns that the labels were being slapped on foods with high amounts of sugar - and on foods with up to 80% of a consumer's recommended daily intake of fat.
And, on Friday, came news that Smart Choices had "voluntarily" decided to stop rolling out the labels while the US regulators investigate.
The halt to Smart Choices merely adds to the consumer confusion around the labels on the foods they buy. The UK debate over traffic lights or GDAs is nothing compared to the amount of different labels developed in the US.
In the last couple of years, retailers like Hannaford and Supervalu Inc have launched their own separate labelling schemes. Then there is the NuVal scoring system used by grocers like Price Chopper and Hy-Vee.
Some consumer advocates have long argued for a mandatory, nationwide system to come into force in the US. The obstacles to such a scheme, given competitive interests, are manifold.
However, with Smart Choices smarting amid an FDA probe, calls for a unified system are likely to continue to grow.
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So, where exactly is still in recession?
23rd October 2009 13:11
Today's (23 October) headlines in the UK are all about our "record" recession.
The figures for the third quarter of 2009 show that that the UK economy contracted by 0.4% between July and September - meaning we have now posted six consecutive quarters of falling GDP.
Or, in other words, the longest consecutive fall since the UK started recording the data in 1955.
After this week's news that growth in China's economy accelerated in the third quarter and, as we highlighted on our pages this week, amid the continuing gloom over Russia's economy, it got us thinking: who is in (and out of recession)?
Fortunately, the UK's Daily Telegraph must have been thinking along similar lines and this morning published a story on the recent performance of the world's other major economies.
If you think we had it bad, look at the figures the Telegraph quotes for Spain. Unemployment there is running at 18% and the Spanish economy is set to remain gloomy well into 2010.
Naturally, food manufacturers in Spain could reasonably expect to be among the more resilient businesses in the country.
However, some have either cut (or are rumoured to be cutting) their operations down there.
Sara Lee has scaled back its bakery business in Spain, while the signs are that the US food group is less than enamoured with its international bakery operations full stop.
There have been rumours that French retail group Les Mousquetaires, the company behind the Intermarché chain is looking to quit the Spanish market. Nothing has been officially announced but a spokesperson told us over the summer that that the retailer's president had ordered the company to keep quiet.
And further more, Spanish food group Ebro Puleva saw its revenues slide during the first half of the year.
As a BMI report on the outlook for the Spanish food and drink sector says: "The market will therefore continue to be a very difficult place to do business for major brand builders such as Sara Lee, and BMI expects such firms to continue to look for ways to cut costs and create efficiencies so as to maximise their chances of maintaining sales in what is now a highly price-sensitive environment."
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Russia is the weakest of the BRICs
21st October 2009 17:04
Cadbury's insistence today (21 October) that signs of recovery in markets in Asia - particularly in India and China - tallied with what some of the other confectioners told just-food this week at a global travel retail event in Cannes.
Todd Stitzer, Cadbury's CEO, also highlighted growth in key Latin American markets. Stitzer claimed that the region had been less affected by the global economic downturn and that, thanks to the "export-driven" nature of its economies, it was seeing growth sooner than other parts of the world.
So, there appears to be some solidity among three of the BRIC markets. But, while Brazil, India and China are gaining strength, as this piece by our deputy editor Katy Humphries highlights, there remains some concern over the economic outlook for Russia.
As the piece says:
'According to the latest World Bank figures, unemployment in Russia is expected to rise to 13% by the end of the year. And, significantly for retailers, Russia's middle class is likely to shrink by about 10%, to 51.2%. In real terms, this means 6.2m people will have dropped out the higher-spending "middle class" social bracket.
Last week, the European Bank for Reconstruction and Development cut its forecast for Russia's gross domestic product this year to a contraction of 8.5%, down from an earlier forecast of a 7.5% contraction.
"It is clear that the social costs of the global economic crisis are only likely to be felt in earnest next year, when corporate bankruptcies and unemployment will continue to rise," EBRD chief economist Erik Berglo warns.'
These turbulent economic conditions are also proving disturbing for food manufacturers selling into Russia.
Yesterday (20 October), research by the UK's Food and Drink Federation (FDF) said the country's food and soft drink exports were up by more than 10% in the first half of 2009.
However, amid rising shipments to scores of countries, the FDF said a "sharp drop" in exports to Russia had "dragged down" shipments to Eastern Europe as a whole.
The weak Russian economy has provided opportunities for some local retailers and today we reported on moves from Magnit, the country's largest retailer by number of outlets, to continue its expansion drive through a share offer.
Nevertheless, there is no doubt that Russia remains the weakest of the BRICs.
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What's this?
Your Comments
Great news...it's about time the palm oil situation was brought to the forefront, urgent action is needed. I'll look forward to the interview.
Joanne Youl, United Kingdom